Europe has been known as the birthplace of some of the world's fastest cars with luxury-minded speed-demons from Italian brands like Volkswagen AG's (ETR:VOW) Automobili Lamborghini S.p.A., German brands like Daimler AG's (ETR:DAI) Mercedes-Benz, or the UK's Bentley Motor Group Ltd. (also a Volkswagen property). Indeed, perhaps no highway system is as famous as Germany's autobahns, where there is no enforced speed limit.

But all of that could soon be changing.

The European Union's Mobility and Transport Department -- a branch of the EU's market regulatory body, the European Commission (EC) -- is preparing an extreme proposal to counter auto fatalities in the region. UK newspaper Telegraph, cites the office of Patrick McLoughlin, the UK's Transport Secretary as warning of the controversial proposal.

The EU is looking to pull the plug on drivers travelling over 70 mph. [Image Source: Porsche]

Reportedly the EC approached Mr. McLoughlin with a pending proposal that sought to use an Intelligent Speed Adaptation (ISA) scheme to prevent any new vehicles sold in the EU from going over 70 miles per hour. The EC officials argued that the proposal was necessary to curb the over 30,000 drivers who die each year on Europe's streets.

But Mr. McLoughlin blasted the proposal; with a "government source" close his office commenting:

This has Big Brother written all over it and is exactly the sort of thing that gets people's backs up about Brussels. The Commission wanted [Mr. McLoughin's] views ahead of plans to publish the proposals this autumn. He made it very clear what those views were.

An EC spokesperson confirmed that talks about new speed regulation are pending, remarking:

There is a currently consultation focusing on speed-limiting technology already fitted to HGVs and buses. Taking account of the results, the Commission will publish in the autumn a document by its technical experts which will no doubt refer to ISA among many other things

Aside from the more basic free market and cost issues, another problem with the proposal arguably is the fact the EU member states vary greatly in traffic fatalities. Out of Britain's thirty eight million motorists, there are only 1,754 fatalities in 2012 -- a 0.0046 percent death rate. By contrast Germany's forty-five million motorists in 2012 got in 3,657 fatalities -- a 0.0081 percent death rate (almost twice as high).

I Germany, 40% of the lethal accidents involve proven excessive speeds (over the allowed limit), while only 9% involve alcohol. Honestly, all accidents on a German Autobahn will involve speeds over 70 mph, nobody goes that slow unless he is driving a large truck. Other distractions don't even make it into the statistics, participation in German traffic is generally much more stress full and requires much more attention than the "cruising" used on many US roads. Many German drivers greatly enjoy driving in the US for exactly this reason.

One thing the proposed law does not consider is the fact that less than a third of lethal accidents (at least in Germany) occur on highways. Federal roads ("Bundesstraße") have a much higher risk, even though they already have a 65 mpg speed limit.

But one important reason for speed limits is the fact that now 60% of casualties are not actually the drivers of the involved cars, but rather pedestrians, bicyclists and bikers. The insides of cars have gotten much safer, but for other people in the traffic, nothing much has changed.

As for other nations, fatality rates are pretty much the same in all European countries (and Canada, Australia, Japan), with Poland and former Russian nations (Ukraine, Belarus etc.) having almost twice the fatality rate capita, and Russia itself going much higher than that again.Interestingly, Europe and Canada manage half the fatalities as the US with a similar Car density, while the Ukraine get to the same fatality rate as the US, but only needs half the automobile density to achieve it.

When you compare fatality rates, you have to take into account number of miles driven for one fatality, and average # of passengers inside an average car. Comparing fatality rates per capita is pretty useless in itself.

The best statistic to compare is # of fatal accidents (not even total fatalities) per 1 billion miles driven. But only few countries would actually have this data readily available.

Once you start comparing apple to apples you would see a different picture.

Consider that in USA people drive much more miles per capita than in any Europian nation.